E - PAPER
CURRENT MONTH
LAST MONTH
Real Estate Leads Healthy Recovery In Emerging Markets
The emerging markets (EMs) have seen a vast improvement in their economic outlook in the past few months. Many Asian EMs have already seen a swing back to expansionary numbers, while the ones in Latin America (LATAM), Europe, Middle East and Africa (EMEA) are seeing a
BY
Realty Plus
Published - Saturday, 05 Dec, 2020
The emerging markets (EMs) have seen a vast improvement in their economic outlook in the past few months. Many Asian EMs have already seen a swing back to expansionary numbers, while the ones in Latin America (LATAM), Europe, Middle East and Africa (EMEA) are seeing a surge in recovery momentum, despite their ongoing battle with COVID-19. The Manufacturing PMI, a leading indicator of economic activity, has rebounded firmly since August for most EMs, and exceeded the developed markets significantly, as per iFast Research, Singapore
Looking forward to 2021, the combination of: i) cyclical recovery, ii) weakening USD, iii) commodity upcycle and iv) continuation of China’s strong recovery should uplift EM’s growth. A vaccine approval next year will be a huge catalyst. Of these, the US dollar weakness and commodity upcycle are likely to be long-term tailwinds, indicating a multi-year positive set-up for EM equities, which have strong inverse correlations with these factors.
Supported by robust double-digit earnings growth projected for the next two years, EM equities (gauged by MSCI EM index), in aggregate, are set to deliver a potential upside of 18 percent by end-2022, despite the elevated valuation.
Due to EMs’ sensitivity to global demand (i.e., exports-focus, heavy commodity exposure), a cyclical recovery can significantly uplift growth in these markets. Based on previous crises, we see that EMs typically register a stellar growth rate of above 5 percent after an economic trough. The recent slew of vaccine news spell another positive for EMs. a vaccine approval (unless late in 2021) should amplify the cyclical recovery, setting the stage for a synchronised global demand rebound.
RELATED STORY VIEW MORE
Nigeria Shows Widening Transparency Gap in Real Estate
Singapore Private Home Rents Set To Climb By 10-15%
Saudi Arabia’s Ambitious Projects from World’s Largest Airport to Skyscraper
NEWS LETTER
Subscribe for our news letter
E - PAPER
-
CURRENT MONTH
LAST MONTH
REALTY+ SPECIAL ISSUES
Test Magazine
THE TECH TITANS 2022
COFFEE TABLE BOOK 2022
Anniversary Issue 2022
Anniversary Issue 2020
VIDEO GALLERY VIEW MORE
